Microsoft’s Approach to the Cloud

As Public Services (PSs) hosted in large, multisite data centers, and delivered over the public Internet.

As Virtual Private Services (VPSs) hosted in large, multisite, multitenanted data centers, and delivered securely over the public Internet. These VPSs are sometimes referred to as Software as a Service (SaaS).

As Private Applications (PAs) hosted in large, multisite, multitenanted data centers, and delivered securely over the public Internet.

Some vendors offer only one type, some two, but only Microsoft offers all three. This is important, and to the extent that Microsoft is able, over time, to employ the same platform for all three, it allows both the easy morphing of PSs into VPSs, and more importantly, the easy morphing of PAs into VPSs, and VPSs into PSs.

This is not the only way in which Microsoft's approach to the cloud is different from other vendors. Microsoft dominates the desktop, and has a growing on-premise server, and on-premise solutions, market share. This, in turn, leads in many organizations to ownership of the definitive internal directory -- Active Directory (AD). This places Microsoft in a unique position to create bridges between an organization's internal IT infrastructure and the "cloud."

This is not an opportunity that Microsoft is wasting. It is on a twofold mission:

To allow organizations to utilize their existing ADs for authentication and authorization of users of PAs and VPSs in the cloud. AD Federation is the technical term for this. As I have noted in a series of other postings on identity (see Microsoft Identity Roadmap), Microsoft is a thought leader and has a very complete roadmap in this domain. The offerings identified in this roadmap (both software and services) will have been released and deployed by the end of 2009. Some are already deployed.

To create a common .NET framework for applications whether they are hosted on-premise or in the cloud (in any guise). This delivers an incredibly powerful differentiation for Microsoft, and one that it has historically exploited with great effectiveness -- it is only a relatively small step for today's Visual Studio-employing Windows developer to morph into a Windows (Azure) in the cloud developer. This is an advantage that should not be underestimated.

It appears that Microsoft is executing this vision well. We expect Microsoft to establish a dominant position in the PA and VPS hosting space. It will continue to face opposition in the PS space, from the likes of Google, etc. The open question is the extent to which Microsoft can create an impregnable position in the VPS space, in the short term, for derivatives of its mature, on-premise, solution servers. For example: